Is there a trick to get DLU to work on Server 2008

I have disabled password restrictions on the server via Security Settings >Account Policies>Password Policy
I have assigned a DLU policy (right now the same one I use for admin accounts.) ZCM shows the policy is applied on the server- as a device
If I login to the ZCM through the agent the policy shows it is now active both as a user and as device

ZCM 11.2.4

Trying to test out a thin client solution. This is just a test workstation currently the device is not have all windows updates installed nor is it activated.